Lufthansa to announce Air Berlin deal

Lufthansa is expected to announce a deal on Thursday to purchase large parts of insolvent airline Air Berlin. The deal has been expected for weeks and Lufthansa CEO Carsten Spohr says today will be “a milestone”.

Lufthansa expects to announce later on Thursday the purchase of large parts of insolvent German airline Air Berlin, Lufthansa CEO Carsten Spohr has confirmed.

“Today will be a milestone in the history of Lufthansa and Air Berlin,” said Spohr in Berlin ahead of the expected announcement around 12pm that a formal deal has been agreed between the airlines.

Germany’s largest airline is expected to buy Air Berlin’s low-cost leisure airline Niki, its LG Walter regional airline as well as up to half of Air Berlin’s A320 fleet. “The deal with Lufthansa is done, there is agreement,” an inside source told Reuters on Wednesday.

Sealing the deal

Air Berlin, which employs close to 8,000 people, filed for bankruptcy in August after its funding was cut off by Etihad, one of its major shareholders.

Negotiations for the sale of Air Berlin’s assets, thought to include some 140 leased aircraft as well as several sought-after landing and takeoff slots at German airports, have been ongoing for the past month.

On September 25, Air Berlin said it was negotiating with Lufthansa and British low cost carrier easyJetfor the sale of its assets, with a deadline of October 12 set for the conclusion of negotiations.

Lufthansa’s bid is thought to be worth between €200-300 million ($238-356 million) while easyJet are also expected to pick up some of the assets.

Air Berlin ceases its long-haul operation on October 15 and from October 28, will no longer operate under its own banner and will fly as a service provider on behalf of the buyers.